The Following Cost Data Pertain to the Operations of Bouffard

question 102

Multiple Choice

The following cost data pertain to the operations of Bouffard Department Stores,Inc. ,for the month of May. The Brentwood Store is just one of many stores owned and operated by the company.The Shoe Department is one of many departments at the Brentwood Store.The central warehouse serves all of the company's stores. What is the total amount of the costs listed above that are NOT direct costs of the Brentwood Store?

• A)$161,000
• B)$86,000
• C)$32,000
• D)$38,000

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Definitions:

Allowance Method

A method of accounting for bad debts that involves estimating and setting aside an allowance for doubtful accounts.

Uncollectible Account

An account receivable that is considered to be uncollectible and is therefore written off as a loss.

Allowance Method

An accounting technique used to estimate and account for potential uncollectible accounts receivable.

Write-off

The accounting action of declaring that an asset or receivable value is reduced or eliminated, often due to uncollectibility or obsolescence.